I buy very little stock. In the 1970s when I first got in the market, I could not understand how to figure out for sure how people were able to put a value on stocks. Then I found out that we have technical traders and fundamentalist. Later I learned about E-Traders who buy and sell stocks faster than I can in-hail and ex-hail. That is when I found out that stocks really have no value. It is just the value that people and computers put on them. It is these traders that create the liquidity in the stock market. With out Liquidity, people could not get in and out of stocks on a daily bases.
http://www.youtube.com/watch?v=WstJM_aNSj8
Steve Kroft gets a rare look inside the secretive world "high-frequency trading," a controversial technique the SEC is scrutinizing in which computers can make thousands of stock trades in less than a second. This may have an affect on the value of your investments when you get ready to use your money for retirement. How would you like your portfolio to fall by 50% in a few weeks just before you retire?
http://www.youtube.com/watch?v=thq9Bqw_iuY&feature=fvwrel
Inside Look - High Frequency Trading - Bloomberg
http://www.youtube.com/watch?v=KQV4zZ-E3O0&NR=1&feature=fvwp
Inside Look - Evolution of High-Frequency Trading - Bloomberg
http://www.youtube.com/watch?v=HxVeopN1bBU&feature=relmfu
In-Depth Look - High-Speed Trading Unfair? - Bloomberg
http://www.youtube.com/watch?v=4vxdA1sqfWc&NR=1
Schumer Seeks To Ban Flash Orders - Bloomberg
http://www.youtube.com/watch?v=F77nhdeHOUA&NR=1
High Frequency Trading Under The Microscope - Bloomberg
Now Look at Gambling with Futures
http://www.youtube.com/watch?v=MHMr4VxyLFE
You want to learn how to gamble, the way the professionals do it? Look at this blog above. Yes you can go to online classes and learn how to do what the professionals do but you will not have the computer speed that the professionals have. Below is the sales pitch that these people give you.
“Precognitive Trading - Mind Over Matter New Futures Trading students make money because they have learned the market's systematic movements! The KEY to a profitable stock market trading is the clear understanding of the Market's Predictable Systematic Movements! NFT will teach you to understand the Market's Systematic Movements. You will learn to enter a trade with precision and hold that trade to its final target! You will learn to see a trading position coming minutes before you take action, and know the possible target even before you take that position! You will learn to trade using only a 5 tick stop loss!”
Conclusion!
Here is the reason why I stay away from the stock market unless I know that it is the bottom of the market and I have a very good idea what stocks are going to go up in the next year. The only other time I invest in stock is when the company is giving a good dividend yield in relation to interest rates and inflation.
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